Sun-Maid moves into the baby and toddler food space with acquisition of Plum Organics
“Plum’s diverse portfolio of organic foods is a natural fit for the Sun-Maid family given our expertise, leadership and rapid growth in healthy snacking, along with our strong emotional connection with family households,” said Overly.
For Campbell’s, the sale of Plum Organics allows the company to pursue its lean portfolio strategy laid out in 2018. The plan was followed by a series of brand divestments including Bolthouse Farms, Garden Fresh Gourmet, its international businesses Arnott's and Kelsen, as well as other smaller businesses such as Habit. In January 2021 the company also sold Ecce Panis to Jimmy's Cookies brands.
Chris Foley, Campbell’s president of its Meals & Beverages division, said the sale of Plum to Sun-Maid will allow the company to drive further growth to its core portfolio of soups, sauces, and beverages – a division of the company which grew by 6% in net sales in Q2 2021 driven by a very strong season for soup consumption, and double-digit net sales growth achieved by the Prego and V8 brands.
Sun-Maid & Plum Organics: Targeting the 'balancer mom'
So what does the transaction mean for Sun-Maid, which up until now has been best known for its dried whole fruit snacks?
Overly said that Plum is part of the company’s overarching strategy to win over millennial parents.
“Adding Plum Organics to our portfolio furthers this mission and is a significant step in continuing to win over millennials and, specifically, the balancer mom, our target. It’s also important to note that Plum snacks meet the nutritional needs of babies, tots and kids, and all of Plum’s products are certified organic and non-GMO—which we know is appealing to the balancer mom,” Overly told FoodNavigator-USA.
“We’ve successfully expanded into the crowded snacking category, and now we’re moving into the baby and toddler food space with a key differentiator and growth opportunity being that we only provide better offerings made with whole fruit (and many other wholesome ingredients).”
He added: “We will continue introducing new foods and flavors based on the latest culinary trends and tastes,” but said that the company was not ready to reveal more at this stage.
Sun-Maid runs its operations out of its headquarters in Fresno, California, and the company will be evaluating manufacturing and distribution options for Plum products (the majority of Plum’s manufacturing takes place in the US and Canada with the exception of a few products that are made in Western Europe).
"We’re examining all of our options to ensure we have the right people in the right roles," said Overly.
Where do pouches stand in the baby food market?
Founded by two parents, Neil and Tana Grimmer, in Emeryville, California in 2007, Plum Organics is often credited for pioneering the baby food pouch market, which commanded a 25% share of the total US baby food market in 2018, according to Nielsen’s Total Food View). A 2017 Mintel report surveying 1,000 US households found that roughly half of kids under the age of three eat purees from pouches, and of these, 58% have one or more pouches per day.
While seen as a more convenient option to jarred baby food, pouches have received criticism on environmental (they are not recyclable) and other grounds for encouraging unhealthy eating habits and hindering oral health development among babies and toddlers (according to a New York Times piece). In recent years, many brands (e.g. Once Upon a Farm, Fresh Bellies, Little Dish, Yumi) have come out with spoonable (often chilled) baby and toddler food products to provide families with an alternative to pouches. Plum also introduced a ‘baby bowls’ line in 2017, which has since been discontinued.
Despite this, in its 2020 Baby Food market report, Mintel notes that the $6.8bn baby/toddler food market will see growth from products positioned as convenient and packaged for on-the-go consumption.
Outside of its blended pouch product line, Plum now has a portfolio that includes kid-friendly snacking options such as packaged snack-size sandwich bites, snack bars, and puffs.